This looks like a good bet: 81% chance of paying off, and $28,937 ahead in today’s dollars after 3 years.
Why
You get your money back around month 11.
It pays off as long as salary a year stays below $74,279.
It pays off as long as taxes and benefits on top stays below 37.1%.
It pays off as long as gross profit they add a month, fully ramped stays above $7,026.
Your numbers
Hire someone · 5,000 simulations
81% chance it pays off
Likely to pay off
Likely result
$28,937
Bad case (1 in 10 worse)
−$13,169
Good case (1 in 10 better)
$68,948
Pays back
month 11
What matters most: gross profit they add a month, fully ramped.
Results are in today’s dollars over 3 years, discounted at 10% a year, against not doing it.
Range of outcomes
Drag the chart or the slider to scroll · click a bar or point for detail
Each bar is how many of the 5,000 runs ended in that range, in today’s dollars, before tax.
Cash gained or spent so far
Drag the chart or the slider to scroll · click a bar or point for detail
Where a line crosses zero is when the decision has paid for itself.
What moves the result
Gross profit they add a month, fully ramped−$30,475 → $88,350
Salary a year$79,615 → −$21,741
Taxes and benefits on top$37,384 → $20,491
Months to full productivity$32,864 → $25,031
Recruiting and setup$30,437 → $27,437
Each bar is the result with that one input at its low and its high value, everything else at likely. The line is the likely result.
About the Decision Simulator
Big decisions rest on numbers nobody knows yet: how fast a hire ramps up, how many customers a price rise loses, what a new location will sell. Give each one a range and the simulator runs the decision 5,000 times, then shows the chance it pays off, a likely, bad and good outcome in today’s dollars, when it pays back, and which unknown matters most. Pick a ready-made decision or set up your own.
How to test a decision
Pick the kind of decision, or “Something else”.
Give a low, likely and high value for each uncertain number; untick anything you know for sure.
Set how far ahead to look and your cost of money.
Read the chance it pays off and what drives it, then download the workbook.
Frequently asked questions
What is a Monte Carlo simulation?
Instead of one guess for each number, you give a range: a low, a likely and a high value. The simulator picks a value from each range at random, works out the result, and repeats that 5,000 times. The share of runs that make money is the chance the decision pays off, and the spread of results shows how good or bad it could reasonably get.
What does “pays off” mean here?
The net present value is above zero: the cash the decision brings in, minus what it costs, over the period you choose, with future cash discounted at your cost of money. A decision that only breaks even after five years can still show a low chance over two.
How should I pick low and high values?
Use values you would be surprised to see beaten: a low you think happens about one time in ten or less, and a high the same. If you know a number for sure (a quoted price, your current revenue), untick it to treat it as fixed.
What is the chart of what moves the result?
A tornado chart. Each input is moved from its low to its high while everything else stays at likely; the longest bars are the inputs worth pinning down before deciding.
